Nonfarm Payrolls Early Insight: 1M Jobs On Tap?
Matthew Weller | May 04, 2021 12:58AM ET
With bank holidays in the UK, Japan, and China yesterday, it’s not surprising that most major markets got off to a slow start as the trading week kicked off. That said, trading activity is likely to pick up sharply as the week rolls on, culminating in Friday’s highly-anticipated release of the April US Nonfarm Payrolls report.
Last month, the marquee US jobs report came in at 916K, crushing estimates of 652K net new jobs, and we also saw positive revisions to the previous month’s release. Economists have taken note of the impressive figure, as well as the ongoing rollout of COVID vaccines, and the consensus estimate for Friday’s report is 975k net new jobs, which would mark the strongest reading on the US labor market in the last eight months.
As we saw in last week’s FOMC meeting , the central bank isn’t likely to make any changes to monetary policy any time soon, so this NFP report is unlikely to have an immediate impact on Fed policy. That said, another strong report, especially if accompanied by an uptick in the average hourly earnings figure, could prompt speculators to start buying US assets in anticipation of the Fed removing some of its stimulus down the line.
h2 Currency pair to watch during NFP: USD/CAD/h2The North American pairing tends to be particularly active on NFP Fridays because Canada releases its own monthly jobs report, giving traders multiple high-impact releases to digest. As of writing, USD/CAD remains within its 6-month bearish channel and is currently testing a 4.5-year low near 1.2250:
With rates extended away from the 50-day EMA, probing this key long-term support level, and the 14-day RSI testing its lowest level of the year, there’s potential for USD/CAD to see at least a short-term bounce if the US jobs report beats expectations and/or the Canadian version of the report comes in soft.
Meanwhile, the 1.2250 represents a clear “line in the sand,” so a confirmed break below that level, if seen, could quickly see USD/CAD falling toward 1.2100.
Original Post
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.